Gold industry requests Govt to reconsider decision | Sunday Observer

Gold industry requests Govt to reconsider decision

Gold industry representatives have made a request to the government to reconsider its decision on import tax on gold which came into effect last week.

An industry representative said, the new tax would hamper the buying power of the consumer and this will in turn result in a decrease in sales. “We expect a 30 percent reduction in sales in the future when the full impact of the gold import tax will be in effect,” he said. The government imposed a 15 percent tax on gold import on the volume and it has affected gold sales, industrialists complain.

The government should consider reducing the tax percentage. “A lower percentage would enable the industry to sustain and grow,” he said.

The island’s gold industry would be adversely affected due to the import tax which came in to effect from April 18 this year, gold industrialists say.

“We import gold directly from the international market and we have to pay more for the volume imported at present as it includes the recent tax. Therefore, our products cost more. This has resulted in consumers thinking twice before purchasing gold items,” a leading gold importer said.

The tax component is passed on to the consumers and this has made gold jewellery prices high. The demand for gold compared to the last year has decreased and it will further decline with the tax coming in to effect, he said. The prices of gold products will be high in future and already the price of a gold sovereign has increased. “We have to increase the price of jewellery we make and this has resulted in a dip in the sales. Though it is too early to comment on the overall impact, there is a drop in sales for the past few days,” gold jewellery manufactures said.

The tax would hamper the buying power of the consumer and this will in turn result in decrease in sales. We expect a 30 percent reduction in sales in the future where the full impact of the gold import tax will be in effect, he said.

The customers will have no option, but to cut down on purchases as the gold sovereign is now sold between Rs 54,500 to 57,300. 

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